Advanced Journal Entries

Advanced Journal Entries

Overview

Advanced Journal Entries

System References

Distribution

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Ownership

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Advanced Journal Entries

Objectives

About Recurring Journals

Recurring Journal Types

Recurring Journal Types

Skeleton Journals

• Skeleton journals have varying amounts in each accounting period. You define a recurring journal entry without amounts, then enter the appropriate amounts each accounting period.

• There are no formulas to enter, only account combinations. For example, you can record temporary labor expense in the same account combination every month with varying amounts due to fluctuations in hours.

Standard Journals

• Standard journals use fixed account combinations and amounts each accounting period.

• You enter a journal using constants. For example, record monthly auto lease expenses with constant amounts charged to the same account.

Formula Journals

• A formula entry is a recurring entry that uses formulas instead of amounts to calculate amounts.

• For example, calculate rent expense based on end-of-month headcounts.

Creating Recurring Journals

Creating Recurring Journals

(N) Journals—>Define—>Recurring

There is a basic four-step process to create recurring journals.

1. Create recurring journal definition.

- Define reusable skeleton templates, standard templates, and formulas.

2. Generate journals.

- Use skeleton templates, standard templates, and formulas to create unposted journal entries.

- Reuse the templates to generate journal entries in multiple accounting periods.

3. Review the journal for accuracy.

4. Post the journal entry.

Note: You can copy entries from an existing recurring journal batch by selecting AutoCopy Batch.

• Consider grouping your recurring entries into one batch (by frequency of generation) to speed processing.

• Journal Entry Region. Optionally, you can enter a range of Active Dates to limit the use of the recurring entry to a specific time interval.

Recurring Journal Entry Lines

Recurring Journal Entry Lines

(N) Journals—>Define—>Recurring (B) Lines

How to Enter a Recurring Journal Line

1. Enter a Line number in the Line field.

2. Enter the Account you want Oracle General Ledger to update when you generate and post your recurring journals.

3. Enter an optional Line Description for the recurring entry line.

4. Enter a Formula for the line if this is a formula recurring entry. Otherwise, enter a standard amount for standard entries.

Note: Formulas are not entered for skeleton journal entries.

5. If you are not entering a formula, enter all remaining lines for your recurring journal entry.

6. Save your work.

Automatic Offset Example

Automatic Offset Example

How to Enter an Automatic Offsetting Line

1. After you enter one or more lines for the recurring journal entry, enter 9999 as the line number for the automatic offsetting line.

2. Enter an account combination for the line, but do not enter a formula. Oracle General Ledger will automatically calculate the amount for this journal entry line when you generate your recurring journal. The difference between the total debits and total credits for the recurring journal entry will be calculated for you.

3. Save your work.

Formula Recurring Journals

Formula Recurring Journals

When creating Formula Recurring Journals, create a formula for each journal line. Each formula can contain an unlimited number of steps. The steps can use any combination of amounts, account balances, and/or operators. The operators that can be used are:

• Enter: To enter the amount or balance from the account listed in the appropriate account.

• Add: To add the amount or account balance in the previous line to this line.

• Subtract: To subtract the amount or account balance in the previous line from this line.

• Multiply: To multiply the last amount or account balance by the number entered on this line.

• Divide: To divide the last amount or account balance by the number entered on this line.

Note: If the formula yields a positive amount, your account will be debited. If your formula yields a negative amount, your account will be credited.

Generating Recurring Journals

MassAllocations Overview

MassAllocations versus Recurring Journals

Steps to Create MassAllocation Journals

Steps to Create MassAllocation Journals

Five-Step Process

1. Create MassAllocation Definition

- Enter batch information

- Create MassAllocation formulas

- Enter MassAllocation formulas

2. Validate Definition

3. Generate MassAllocation Journals

- Choose which batch to generate

4. Review Entries

- Review the journal for accuracy

5. Post the Journal Entry

Defining MassAllocation Journals

Defining MassAllocation Journals

(N) Journals > Define > Allocation

To create MassAllocation Journal, use the following basic steps:

1. Open the Define MassAllocations window.

2. Enter a Name and Description (optional) for the MassAllocation batch.

3. Choose Actual or Encumbrance from the Balance Type poplist.

4. Select Formulas to enter MassAllocation formulas, then save your work.

5. Select Validate All to validate this batch and other unvalidated batches.

Note: Formulas cannot be generated until they have been validated successfully. Oracle General Ledger verifies that allocation formulas conform to MassAllocation definition rules. If Oracle General Ledger finds an invalid allocation, it marks the entire batch with an error status. Validation does not guarantee that an journal entry will be created from the journal definition. There must be balances in the accounts used in the MassAllocation journal.

6. Check the MassAllocation batch validation status:

- Validated: The definition is valid and follows the definition rules.

- Not Validated: The definition had not bee validated yet. Select the Validate ALL button.

- In Process: Oracle General Ledger is still validating the formula.

- Error: The formula is not correct. Make corrections and select for validation again.

7. Generate unposted journal batches from your MassAllocation formulas.

Note: You can identify errors using the MassAllocations/MassBudgeting Validation Report.

Defining MassAllocation Formulas

Defining MassAllocation Formulas

(N) Journals > Define > Allocation (B) Formulas

How to Enter a MassAllocation Formula

1. Open the Define MassAllocations window and enter or query the name of the MassAllocation batch to which you want to add the formula.

2. Select Formulas.

3. Enter the Name, Category, and Description (optional) of the MassAllocation formula. Categories help you group journal entries in a convenient manner for reporting and analysis.

4. Select whether to Allocate Balances from the full balance or from a single entered currency. If you are allocating encumbrance balances, you must allocate the full balance. You cannot allocate foreign currency encumbrances.

5. Select Full Cost Pool Allocation to have rounding differences added to the cost pool with the largest relative balance. If you do not choose this option, any rounding differences will remain in the original account.

6. Enter the formula lines using the formula A*B/C.

- A is the Cost Pool that will be allocated. The can be amount or an account balance.

- B is the numerator of the factor (a number or statistical account) that multiples the cost pool for the allocation.

- C is the denominator of the factor (a number or statistical account) that multiples the cost pool for the allocation.

Note: Parent values can be used in one or more segments. To improve performance keep the number of parents to a minimum.

Account Segment Types

Looping (L)

• Assign this type to a parent segment value to include each child value assigned to the parent value in the formula.

• The allocation program runs the formula once for each corresponding child segment value.

• You can loop only on parent values.

Summing (S)

• Assign this type to a parent segment value to sum the account balances of all the child segment values assigned to a parent.

• You can sum only on parent values.

Constant (C)

• Assign this type to a child segment value to use the detail account balance associated with the child value.

Target and Offset Accounts

These are the lines that are the actual journal entry.

Target (T)

• Enter an account in the Target line to specify the destination for your allocations.

• The parent value used in the target must be the same parent value used in the B and C lines of the formula.

Offset (O)

• Enter an account in the Offset line to specify the account to use for the offsetting debit or credit from your allocation.

• The Offset account is usually the same account as formula line A to reduce the cost pool by the allocated amount.

MassAllocation Journal Example

Rent Expense Example

You can automatically allocate rent expense.

Row Co Dept N. Acct

A 01 000 5740 Allocate cost pool to all departments

C C C

B 01 999 SQFT Loop through square footage of each department

C L C

C 01 999 SQFT Total the square footage

C S C

T 01 999 5740 Assign each department the result of A*B/C

C L C

O 01 000 5740 Use cost pool as offset account.

C C C

Note: In the last example, O must be different from A to add incremental allocations.

Validating MassAllocation Journals

There are four validation statuses:

• Validated: The definition is valid and follows the definition rules.

• Not Validated: The definition had not bee validated yet. Select the Validate ALL button.

• In Process: Oracle General Ledger is still validating the formula.

• Error: The formula is not correct. Make corrections and select for validation again.

Generating Mass Allocation Journals

AutoAllocations Overview

• AutoAllocations is a powerful feature to automate journal batch validation and generation for:

- MassAllocations

- Recurring Journals

- MassBudgets

- MassEncumbrances

• Use AutoAllocations to process journal batches you generate regularly, such as month end closing.

AutoAllocation Workbench

You can use the AutoAllocation Workbench to automatically allocate any financial amount throughout your organization.

You can create allocation sets with the AutoAllocation Workbench by grouping allocation journals in an intuitive form. AutoAllocation supports any combination of MassAllocations, MassBudgets, Recurring Journals, MassEncumbrances, and Oracle Projects allocation rules. The AutoAllocation Workbench also supports both Step-Down and Parallel allocation sets.

Oracle General Ledger also provides the AutoAllocation Workbench to Oracle Projects users. Project accountants can access the AutoAllocation Workbench directly from Oracle Projects to create Step-down and Parallel allocation sets. You can even combine allocations in Oracle Projects with Oracle General Ledger allocations. This tight integration allows for more effective financial management, because you can leverage the most current financial data from both applications as the basis for your allocations.

Oracle Workflow controls the approval and rollback processes.

Business Benefits of AutoAllocation Workbench

• Automates step-down and parallel allocations

• Monitors allocation processes online

• Optional automated rollback eases error recovery and control

• Oracle Workflow notifies users of step-down allocation process results

• You can use Oracle Workflow to incorporate approvals into the step-down process

AutoAllocation Set Types

Step-Down AutoAllocations

• You must create journal batches in a specific sequence when using Step-down AutoAllocation.

• Order your journal batches so that the process results of one step are used in the next step of the AutoAllocation set.

• Step-down AutoAllocation sets automatically validate, generate, and post all journals created by the process.

Note: You can navigate to all the required forms to define MassAllocation and Recurring Journal formulas from the AutoAllocation workbench window.

Parallel AutoAllocations

• Validates and generates all the journal batches in the AutoAllocation set simultaneously.

• You can then post the generated journals to update your balances.

Additional Workbench Functionality

AutoAllocation Sets and Oracle Workflow

• The Step-down AutoAllocation process invokes subprocesses to generate and validate AutoAllocation set batches incorporating approvals and notifications at various points in the process.

• If the generation batch requires approvals, Workflow launches the batch approval process.

• If the Step-down AutoAllocation process fails, Workflow gives the contact individual or responsibility the option to rollback the process. Rollback cancels any generated journal batches and reverses any posted journal batches.

• To use the rollback option, you must set the GL: AutoAllocation Rollback Allowed profile option.

AutoAllocations and Oracle Workflow

• The Step-down AutoAllocation process invokes subprocesses to generate and validate AutoAllocation set batches incorporating approvals and notifications at various points in the process. If the generation of a batch requires approvals, Workflow launches the batch approval process.

• If the Step-down AutoAllocation process fails, Oracle Workflow gives the contact individual or responsibility the option to roll back the process. Rollback cancels any generated journal batches and reverses any posted journal batches.

Note: You must select the GL: AutoAllocation Rollback Allowed profile option for rollback to be an option if the AutoAllocation process fails.

• The Workflow process is delivered with four customizable functions that allow customers to have more control in the validation and generation of journals resulting from Step-down allocations.

AutoAllocations Constraints

Submitting AutoAllocation Set Requests

Before you submit your AutoAllocation set, complete the Parameters window, which must be accessed from the AutoAllocation Workbench window.

Submit Parallel and Step–Down AutoAllocation sets:

• Immediately

• Scheduled Later